Doing Business in the United States of America - Assignment Example

Outline Introduction Global Business Strategy Conclusion References Introduction Glass phone manufacture entails the processes where phones are manufactured from glass technology with glass material. The glass used to manufacture the phones is toughened so that the mobile phone is potent and appears somewhat luxurious to users. The technological functionality of the phone is just like the normal cell phones although it incorporates the use of glass materials in its manufacture. The manufacture of glass phone necessitates the use of skilled labor because of the need for high quality products that are reliable. Market penetration and sustainable competitive advantage of glass phone is dependent on customer satisfaction from high quality products (Mokhtar, 2011, p.33). The United States has huge population of skilled considering the fact that most skilled labor from developing countries migrates to the United States in search for better opportunities. Glass Phone Manufacture in the United States of America Operation of glass phone manufacture in the United States of America puts into consideration the fact that the company is in need of skilled labor, which is sufficiently available in the country. According to OECD (2001, p.374), the country has favorable policies that allow migration of skilled labor from other countries where opportunities such as glass phone manufacture may be limited. Glass phone manufacture highly requires skilled considering the needed reliability of the product by users. Market penetration for the product highly depends on how reliable the phone is as compared to other phone manufacturers that provide highly reliable phones though not as luxurious as the glass phone. The company has to embrace a global strategy that would pertain to allocation of the glass phone manufacture company's resources to operations in the United States where it can take advantage skilled labor available. The business global strategy is in the context of operation although considerations of the market place are also an essential factor to its operations in the United States of America. Buyers and users of the glass phone are the middle and high-income earner who can easily afford the relatively high prices attached to the product. The glass phone is considered as a semi luxurious product for social classes and technological advancement needs for users. The operations of the company in the United States of America are also tied to the fact that cultural factors of the present day in the country are focused on cell phones as a social item that is basically used to communicate. Social factors in the United States of America influence the purchasing behavior of potential customers for the glass phone that may go a long in enhancing their social relationships (European Conference on Information Systems, 2009, p.3). More so, the country is an active participant in modern practices of international trade evidenced by the North American Free Trade Agreement as a move towards reducing trade tariffs and other trade barriers such as political interests. The legal environment in the country is also able to protect technological innovations and investors as depicted by the ability of Apple to file a suit against HTC cell phone manufacturers in the US district court with regards to patent infringement (Schonfeld, 2010). Global Business Strategy The global business strategies are advantageously applicable in the country given free trade trends in the macro economic environment that the glass phone company may use to stabilize its global strategies. Glass phone manufacture may seek to expand its operations in the United States to take advantage of the economies of scale in both the domestic market and the foreign market. Implications of free trade trends in the United States have led to a vastly heightened effect on lifestyle goods and services being imported and exported to feed in to the living standards needs. The glass phone manufacturing company, which is rather considered a luxurious product manufacturer, can perfectly fit its operations into such an environment. Glass phones in this case can be established on the basis of its decent and stylish look of attraction which is basically part of the reason why cell phones grew rapidly to replace the fixed like line telephone (Afridi et Al., 2010, p. 428). The United States has adopted dramatic proliferation and refinement of global telecommunications, which necessitate the venture of innovative products such as the glass phone to embrace the global trends and capture the vast amount of opportunities. The huge amount of global business opportunities in the United States of America is indicated by the huge growth in flows of foreign direct investment into its economy. The glass phone manufacturing company being a significant participant in the global telecommunication industry is best fit to channel its direct investment in the United States of America to tap onto vast amount of opportunities. Dynamics of global business strategies follow the classical theories, proportion theories and product life cycle theory. Economic advantage is defined by the international trade classical trade where the country of operations emphasizes on production and exportation of goods and services that it benefits economical from. Since production of glass phones requires the use of materials readily available both in the foreign and domestic market, it can take advantage of production capability to export this products for significant economic gains. Give the economic advantage the United States has over developing countries in technological products, the company can best operate in the country and capitalize on this economic advantage. Glass phone is considered as a milestone towards technological advancement that when adopted by local users in the United States can fetch an expansive market in the foreign market. Glass phone advanced technological abilities can achieve global recognition through embarking its manufacturing operations in a country recognized of its technological abilities such as the United States of America. Technological innovations also need to embrace production at lower prices and high quality, which necessitates operations in a country where production materials and labor are readily available at reasonable prices. Free trade and favorable trade policies that exist in the United States enable accessibility of glass phone production resources at reasonable prices. Resources for production of glass phone in the United States are consistent with the dynamic theory of proportion where successful operations in the global business thrive on reasonable prices and low costs. Irrespective of the fact that glass phones are luxurious products, and therefore costly, prices need to be reasonable and consistent with other luxurious products that have penetrated the global market. Proportion theory asserts that levels of prices differ from one country to another primarily on the basis of factors concerning the supply of resources of production. Supply of skilled labor in the United States of America is the major factor in consideration to the company establishing its operations in the country. Established companies will generally penetrate the global market to the level of its technological prowess plus accessibility of input products for the manufacturing process. The product life cycle of the glass phone takes into consideration factors such as innovation and technology of the product concerning establishing its stronghold in the global market. Glass phone product life cycle incorporates four phases; the first phase being where the new product is initially manufactured in the United States and thus, it partially succeeds because of advantages of the country of operations. The second phase involves the process where the glass phone gains familiarity in the global market due the product uniqueness and the competitive nature of the United States of America irrespective of competitive disadvantages in the local environment. This phase is the major determinant of the level of acceptance of the product in the global market. Third phase of the glass phone product life cycle is the competition it faces from other phone manufacturers such as Nokia, Sony, and Motorola, which have a higher propensity of reacting to introduction of the Glass Phone. However, survey shows that cell phone users cannot be loyal to a particular manufacturer and thus, glass phone has the opportunity to win over the clients depending on its innovative abilities (Needle, 2010). Operations in the United States of the glass phone manufacture may also go along way in successful penetration of the global market through market concentration. Market concentration in vibrant and established global markets such as the United States cell phone users is a fundamental aspect in the global business strategy. Countries and organizations seeking to establish its products in the global market have realized that in the long run, concentrations in small segments is the determining factor to global market penetration. The United States comprises a considerably huge percentage of the global economy and thus concentration on its small market segments may go a long in establishing glass to compete with giant cell phone manufacturers. The stage of a region’s economic development is also an important factor to be considered by glass phone manufacture with regards to the country to establish its operations. Companies established in relatively industrialized economies have a higher possibility of accessing easily accessing both input resources and product markets for luxury products. In addition to resource and market accessibility, industrialized countries tend to experience social and political stability alongside a stabilized monetary and fiscal infrastructure that is favorable to manufacturing companies such as glass phone manufacture. The United States is and has a stable framework for new technologies and companies. Conclusion Countries and organizations have engaged in initiatives towards attaining strategic global advantage for the business benefits existing within their macroeconomic environment. Glass phone manufacturer pursues the establishment of it operations in the technologically innovative environment such as the United States of America whose macro economic framework is friendly to it operations. Most companies in the United States of America have ventured into the global business with their new technological innovations being protected by patent tights. The Glass phone technology being an innovation in the cell phone industry, the company needs to establish its operations in country with favorable macro economic environment. Furthermore, manufacture of glass phone is a specialized kind of venture that may necessitate the presence of readily available skilled labor and economic advantage of the country in which it operates. Reference List Afridi, S. A., & et Al., 2010. The Analysis of Cellular Services and Estimating Fixed to Mobile Price Elasticities-A Case Study of United Kingdom. European Journal of Scientific Research. [Online]. Available at: http://www.eurojournals.com/ejsr_40_3_11.pdf (accessed 8 January 2012). European Conference on Information Systems. 2009. The Impact of Culture on Mobile Phone Purchasing: A Comparison between Thai and British Consumers. Scholar One. [Online]. Available at: http://www.ecis2009.it/papers/ecis2009-0515.pdf (accessed 8 January 2012). Mokhtar, S. S. M., & et Al., 2011. The Relationship between Service Quality and Satisfaction on Customer Loyalty in Malaysian Mobile Communication Industry. School of Doctoral Studies (European Union) Journal. [Online]. Available at: http://www.iiuedu.eu/press/journals/sds/SDS_2011/BME_Article4.pdf (accessed 8 January 2012). Needle, D., 2010. Survey Reveals No Customer Loyalty in Mobile Market. The Network for Technology Professionals. [Online]. Available at: http://www.internetnews.com/mobility/article.php/3905061/Survey+Reveals+No+Customer+Loyalty+in+Mobile+Market.htm (accessed 8 January 2012). OECD. 2001. Trends in International Migration 2001: Continuous Reporting System on Migration. SOPEMI. [Online]. Available at: http://www.oecd.org/dataoecd/23/41/2508596.pdf (accessed 8 January 2012). Schonfeld, E., 2010. The Complaint: Apple's Patent Lawsuit Against HTC Is All About Android. AOL Inc. [Online]. Available at: http://techcrunch.com/2010/03/02/the-complaint-apples-patent-lawsuit-against-htc-is-all-about-android/ Read More